Six out of 10 in-house counsel reported that the growth in baseless putative class actions poses a substantial risk to their companies. They describe these class actions as those that have no merit, but where the companies are forced to defend them nonetheless. Top legal decision-makers believe courts are becoming more lenient in allowing class actions to move forward, which creates a significant cost that is disproportionate to the merits of the claim. Almost one in ... Keep Reading »
Class Action Survey: Companies Report “Sweet Spot” for Class Action Panels
Did you know companies have a “sweet spot” for the number of law firms they use for their class action panels? Most companies are relying on small groups of law firms to manage class actions, according to the 2023 Carlton Fields Class Action Survey. The benefits include more uniformity in the approach to class actions, more diversity of thought than a single firm, reduced management time, more understanding of client goals, and improved cost control. Only a small segment ... Keep Reading »
Class Action Survey: Companies Perceive Consumer Fraud Class Actions as Posing the Biggest Risk
Companies continue to see consumer fraud class actions as posing the largest threat by a wide margin, pointing to claims based on both the use of social media, and ESG disclosures and practices. Employment claims pose more risk than previously reported because perceived employee activism created unrest, lost productivity, and financial risk alongside the costs associated with an increased number of baseless claims. Securities fraud class actions against public companies ... Keep Reading »
Class Action Survey: What Types of Class Action Matters Are Most Prevalent? Two Types Have Driven the Bulk of Class Action Spending Over the Last Five Years
Labor and employment and consumer fraud matters remain the two most common types of class actions. Together, they have driven the bulk of class action spending over the last five years. The 2023 Carlton Fields Class Action Survey reports that labor and employment leads both in number of class actions (33.6%) and in share of overall class action budgets (34.8%), by a wide margin. This is well up from last year’s reporting, when labor and employment was 23.5% of the ... Keep Reading »
Class Action Survey: Did Class Action Defense Spending in 2022 Continue Its Upward Trend?
Companies increased the percentage of their legal budgets allocated to class actions to 14.4%, up from 13% two years ago. For the first time, spending on class actions increased to more than $3.5 billion, according to the 2023 Carlton Fields Class Action Survey. In 2023, class action spending is expected to be one of the fastest-growing areas of legal spending. The increased spending has two major drivers: claims are getting larger, and more companies are facing class ... Keep Reading »
Eleventh Circuit Vacates Class Settlement in GoDaddy TCPA Suit Based on Improper Class Definition
The U.S. Court of Appeals for the Eleventh Circuit recently solidified an important rule about class standing: the definition of a class in a settlement agreement must be limited to class members with Article III standing. In Drazen v. Pinto, the Eleventh Circuit vacated the district court’s approval of a $35 million settlement agreement because the class definition included members who lacked Article III standing. Drazen involved a class action against GoDaddy.com ... Keep Reading »
Delivery in 30 Minutes or Less: Supreme Court Punts on Who Qualifies Under FAA Exemption for Interstate Commerce Workers
In Domino’s Pizza LLC v. Carmona, Domino’s petitioned the U.S. Supreme Court to clarify whether drivers making only in-state deliveries of goods, ordered by in-state customers from an in-state warehouse, engaged in interstate or foreign commerce, exempting them from arbitration under Section 1 of the Federal Arbitration Act. The Supreme Court on October 17, 2022, granted Domino’s petition for certiorari, vacated the Ninth Circuit’s ruling allowing the drivers to ... Keep Reading »
Proposed Cryptocurrency Class Action Goes Forward in Florida With Defendant’s Help
Two plaintiffs in Miami-Dade County have filed a class action complaint against cryptocurrency platform Empires X Corp. and its founders based on an alleged Ponzi scheme. In Villanueva v. Empires X Corp., pending in Florida’s Eleventh Judicial Circuit, the plaintiffs allege that they, as well as several other damaged investors, provided millions of dollars to Empires X Corp. based on extensive misrepresentations that Empires X Corp. was a legitimate investment ... Keep Reading »
Fitting a Square Plaintiff Into a Circle Class? No Can Do Says Florida Federal Court
A recent decision issued by Chief Judge Timothy J. Corrigan of the Middle District of Florida highlights a straightforward yet consequential class action principle: a plaintiff cannot serve as a class representative for a class to which he or she does not belong. The specific case is Gartrell v. J.J. Marshall & Associates Inc. In Gartrell, the plaintiff alleged that the defendant violated the Fair Debt Collection Practices Act (FDCPA) and the Florida Consumer ... Keep Reading »
District Court Asks Sixth Circuit to Review Two-Step FLSA Collective Certification Test
The Sixth Circuit will soon tell us whether it will follow the Fifth Circuit’s lead in Swales v. KLLM Transport Services LLC and adopt a more exacting, one-stage certification approach for Fair Labor Standards Act collective actions, or instead officially adopt the two-stage certification process set out in Lusardi v. Xerox Corp., which is currently followed by most district courts. In Holder v. A&L Home Care & Training Center LLC, former aides claimed that ... Keep Reading »
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